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WASHINGTON (CNNMoney.com) — President Obama announced Tuesday that he plans to nominate Ben Bernanke to a second term as head of the Federal Reserve.

“Ben Bernanke, has led the Fed through the one of the worst financial crises that this nation and this world have ever faced,” Obama said from Martha’s Vineyard, Mass., as Bernanke stood by his side. “As an expert on the causes of the Great Depression, I’m sure Ben never imagined that he would be part of a team responsible for preventing another.”

Obama said that Bernanke’s “background, temperament, his courage, and his creativity” helped him to prevent another Great Depression.

Bernanke, a Republican, has played a central role in the government’s extraordinary response to the recession and 2008 banking panic.

Bernanke will have to be confirmed by the Senate. His term ends on Jan. 31. Fed chairmen serve four-year terms.

The question of Bernanke’s reappointment had been the focus of much speculation. Recently many economists and insiders had said they believed that he would more than likely keep his job.

The Fed has drawn criticism for not taking a stronger hand earlier in the crisis and for their part in inflating the housing bubble by keeping interest rates low for so long.

“The Federal Reserve like other economic policymakers has been challenged by the unprecedented events of the past few years,” Bernanke said Tuesday. “We have been bold or deliberate as the circumstances demanded, but our objective remains constant to restore a more stable financial, and economic environment in which opportunity can again flourish and Americans’ hard work and creativity can receive their proper rewards.”

The Fed is charged with examining bank soundness, as well as checking the cost and availability of money and credit in the economy. Given the more than $1 trillion the Fed has printed to get the credit markets moving, there’s a renewed focus on watching for signs of inflation.

Over the past three decades, the country has had only three Fed chairmen. New presidents have tended to keep Fed chiefs in place regardless of political party to maintain continuity in monetary policy and confidence in the markets.

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